Mediatek will invest in Paytm; values it at $4.8 bn

Taiwanese chipmaker MediaTek Inc.’s Mountain Capital fund as part of its on-going fundraising exercise, has given a commitment of $60 million to One 97 Communications Ltd, which runs mobile payments and e-Commerce platform Paytm.
Remarkably, MediaTek has invested in Paytm’s competent MobiKwik. In May, MobiKwik raised $50 million in its Series C round led by Japan’s GMO Payment Gateway and MediaTek.
Last month Paytm dispensed shares worth Rs 85 lakh each to the three new board members- Neeraj Arora, Global Business Head at WhatsApp, Naveen Tewari, Co-Founder of InMobi, and Ruchi Sanghvi, the first female Engineer at Facebook; at Rs 3,300 each, the company’s filings with the Registrar of Companies disclose.
Likewise, Alibaba Group put in some money from a larger portion of investment last November, according to VCCEdge, the data research platform of VCCircle. Alibaba, together with its payments arm Alipay, retains around 41% of One 97 and is the single largest shareholder of the firm that operates Paytm.
Several media reports reported that Paytm was raising as much $350 million (Rs 2,350 crore) in a fresh round of funding valuing it at $5 billion. The company was reportedly talking to a clutch of potential investors that also include Singapore state investment arm Temasek Holdings Pte, Goldman Sachs Inc, Taiwan’s Foxconn and Singapore’s sovereign fund GIC Pte.
Paytm is also spinning off its e-commerce business as a separate unit even as current investor Alibaba is trying to enter India either autonomously or through an acquisition. Paytm has developed a new entity known as Paytm E-Commerce Pvt Ltd for this purpose.
On the other hand, Alibaba is reportedly pondering as to whether it should deposit money directly into the parent company One 97 or buy stakes in Paytm Payment Bank Ltd & Paytm E-commerce, according to Mint.
Paytm’s closest competitor in its core business of mobile wallets, MobiKwik, raised $40 million in a new round of funding from South Africa’s Net1, last Friday.
Paytm is a smart player in the e-commerce market, although it is dominated by Flipkart, Amazon and Snapdeal.

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